Good afternoon. My name is Eva, and I will be your conference operator today. At this time, I would like to welcome everyone to the Salesforce.com and Workday Strategic Partnership conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during that time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. It is now my pleasure to turn our conference over to our Senior Director of Investor Relations, Mr. John Cummings. Mr. Cummings, you may begin.
Thank you, Eva. Good afternoon, everyone. Thank you for joining us today to discuss our recently announced plans to integrate Salesforce.com and Workday product lines. With me today are Marc Benioff, CEO of Salesforce.com, and Aneel Bhusri, Co-CEO of Workday. Marc and Aneel will open with a few prepared remarks about the integration plans. Then we'll open the call for questions. During today's call, we may reference unreleased services or features not yet available. Because we cannot guarantee the future timing or availability of these services or features, we recommend customers listening today make their purchase decisions based on services and features currently available. On today's call, our discussion and responses to your questions may contain forward-looking statements which are subject to risks, uncertainties, and assumptions.
Should any of these risks or uncertainties materialize, or should our assumptions prove to be incorrect, actual integration and product results could differ materially from these forward-looking statements. All these risks, uncertainties, and assumptions, as well as other information on potential risk factors that could affect ours or Workday's business, are included in our respective forms filed with the SEC, including our most recent reports on Form 10-Q, particularly under the heading Risk Factors. With that, I'll turn the call over to Marc.
Hey, thanks, John. Today is a great day for the cloud. I'm really excited to announce a strategic partnership between Salesforce.com and Workday. Workday is the world's leading provider of enterprise cloud apps for human resources and finance. Aneel and I both agree that Salesforce.com and Workday need to unite our clouds. That's why we plan to integrate the entire Salesforce and Workday product lines to enable our customers mutual success with all of our applications and platforms, offering our customers a pre-built, integrated solution. Hey, over to you, Aneel.
Thanks, Marc. I'm thrilled to be making this announcement with you today. Salesforce.com is the world's largest enterprise cloud computing company and the world's number one CRM platform. Salesforce and Marc have been a key part of Workday's success and great friends from the very beginning of Workday. They have helped us achieve outstanding levels of growth. That's why we're so excited that our two companies are coming together to jointly develop deep integrations between Workday's human capital management and financial apps and Salesforce.com's number one sales, service, and marketing apps in the Salesforce.com platform. These integrations will enable our customers to buy a complete enterprise cloud solution end to end from both Workday and Salesforce. Marc, together, we will deliver the world's first comprehensive solution for running the world's largest enterprises completely in the cloud. Back to you, Marc.
Well, thanks so much, Aneel. To make sure that our integrations work extremely well, Salesforce plans to standardize on Workday's apps and platform. Workday is also planning to standardize on Salesforce's apps and platform. That's just a huge commitment from both companies to each other. By jointly developing these integrations and using each other's technology, well, we're going to ensure that our applications work seamlessly together from the start and will continue to work with every new release. Our employees are going to have tremendous familiarity with each other's products. This will minimize deployment times and costs, and it's just great for customers. Salesforce.com users are going to be able to build applications using data directly from Workday. Chatter users will also be able to receive updates directly from Workday, allowing our customers to act upon workforce data in real time.
Our Sales Cloud and Service Cloud users will be able to access data from Workday across any business process, such as sales, personnel, payroll, and budgeting. I couldn't be more thrilled with this deep integration. Hey, back to you, Aneel.
Marc, we just finished up our user conference last week. This is exactly what our customers have been asking for. We have a lot of very large joint customers. Now Workday HCM users will be able to use data from Salesforce to fuel greater workforce productivity engagement. Workday financial users will be able to use data from Salesforce to achieve greater visibility into their financial and operational performance for improved decision-making.
Well, Aneel, I agree. I couldn't be more excited. It's been a phenomenal week. I was in Indianapolis earlier this week for the ExactTarget Connections Conference, which was spectacular. I've met so many customers who are using Workday, and now this deep integration between both of our products, well, this is exactly what everyone's looking for. We'll plan to unveil more details on this partnership with Workday and Aneel at Dreamforce, which is the world's largest technology conference, which will be happening from November 18th to the 21st in San Francisco, and it will feature the band Green Day. Hey, with that, let's open up the call for questions.
At this time, I would like to remind everyone, if you would like to ask a question, simply press star, then the number 1 on your telephone keypad. That is star, then 1 to ask a question. Your first question comes from the line of Kash Rangan with Merrill Lynch.
Congrats on the partnership. I'm curious, Marc and Aneel, to get your thoughts on what was the impetus behind this partnership? Secondly, I'm wondering if this could lead to a deeper partnership whereby Salesforce.com could actually recommend the Workday financial solution and possibly the HCM solution within its vast customer base. Thank you again.
Well, I'll begin with that. Kash, I'll tell you, I recommend the Workday HR system and the financial apps right now to all of our customers. When I make calls around the world and visit our most important customers, they ask me, who's doing the pioneering work in HR and finance in the cloud, and the answer is always Workday. I couldn't be more thrilled with that. Aneel?
Yeah, I would just echo that. Until Marc announced Marketing Cloud, we were using, I think, every product that Salesforce has from the sales and service side, and we recommend those products to our customer base as well. The real impetus for this, Marc and I talked about it, our customers are asking us to do this. We have so many large enterprise customers, companies like Thomson Reuters, that want to see our clouds integrate seamlessly. It reduces their costs and adds to the benefit of the unified offering.
Your next question comes from the line of Brent Thill with UBS.
Good afternoon. Just to follow up on Kash's point, from a go to market in your sales force, is there any type of quota credit that they're going to have, or is this merely, right now, at this point, just engineering-related?
Well, thanks. I appreciate that question. Today, this is primarily an engineering and internal use agreement. We are not currently compensating our sales reps for direct sales of Workday. Through our ISV program and through our partner programs, our organization does receive tremendous support for recommending, selling, and marketing products by our ISV partners, including Workday.
I would add that our sales forces work really well together, have historically, and will continue to do so. I think this is just another part of the messaging that they can deliver to joint customers, which will bring the two sales forces even closer together.
Your next question comes from the line of Doug Henschen with InformationWeek.
Yeah. I have a little sense of deja vu here with the Salesforce partnership with Oracle. Maybe refresh my memory. Didn't Salesforce promise to use and integrate Oracle HCM and financial apps? What then does standardize, talking about the company standardize on these products, what does that mean?
Well, we do use the Oracle general ledger internally, but we have chosen the Workday HCM package as our standard for Salesforce. We've evaluated a variety of packages, but we have made the decision to go with Workday.
Your next question comes from the line of Heather Bellini with Goldman Sachs.
Hi. Great. Thank you very much. Congrats to both of you. Marc and Aneel, I'm just wondering if you could share with us what type of impact you think the tighter integration between your different applications will have on implementation times and cost of deployments for your customers.
Well, I think this will be actually one of the great benefits. We already know that the fastest way to success in enterprise software is through cloud computing. We also know it's the highest rate of success, and we also know it's the lowest cost. We know one other thing, is that as technology has moved forward in the industry, such as the rapid adoption of mobile technology and social technology over the last few years, it's the cloud computing vendors that have been able to move the fastest to it because of the nature of the cloud computing model. When you start to unite two great cloud computing companies like Salesforce and Workday, you're going to end up with an opportunity for customers to do exactly what you said, have much lower cost implementations, much greater levels of success. You know what?
There's also going to be, what I call, future perfect. As the future unfolds and as new technologies evolve, these solutions are going to help those customers get to the future faster.
I would just add that in our customer implementations, the number 2 line item after the business process design is actually the cost of integrations. If we can strip out the cost of integrations by having prepackaged integrations, I think that's just great for customers. It's a complete win-win for them.
Your next question comes from the line of Rebecca Wettemann with Nucleus Research.
Hi, Marc. Congratulations. Great announcement. Can you talk a little bit about the overlap between Salesforce and Workday customers today? Anything you're seeing by vertical, by type of company?
We have many customers that overlap. If you take a look at both of our customer bases, you'll see that overlap occurred. Aneel already mentioned one of them, which is Thomson Reuters, which is such a great example. Of course, Thomson and Reuters merged to create a phenomenal new company. When they reconsidered all of their various options for how they were going to automate their organization, well, for HR, they chose Workday, and for all their sales and service and marketing, they chose salesforce.com. That's why I'm so excited about the relationship. I will say, it's not just very large companies like Thomson Reuters. There's plenty of smaller and medium-sized companies as well that have chosen both products.
Your next question comes from the line of Nathan Schneiderman with Roth Capital.
Aneel, congratulations on the expanded partnership. I have a couple of marketing suite and Marketing Cloud-related questions. Marc, a lot of excitement at the ExactTarget conference this week, and it sounds like the relationship has already led to some big deals for ExactTarget's marketing suite. I was hoping you could share some of the details there. For Aneel, I was wondering, just to clarify, are you planning to adopt the marketing suite, and would that mean you're adopting all the components, Radian6, Buddy Media, Social.com, and ExactTarget? Did the ExactTarget acquisition influence your decision to adopt the marketing suite, if that's the direction you're going? Thanks very much.
Well, we did see some phenomenal new technology and market momentum from ExactTarget this week in Indianapolis with Connections. First, the Connections conference, by itself, if you were there, you just saw the phenomenal momentum, customer excitement, partner excitement, analyst excitement. I've never seen technology like this before. It is the absolute way that we're going to see these companies connect with their customers entirely new ways. You look at these great organizations, whether it's how Nike has connected the FuelBand, whether it's how Sony has connected the PlayStation, or you look at a common customer of salesforce.com and ExactTarget like CareerBuilder, the way they've deeply integrated the product. Marketing is the third leg of the stool, and we just have a phenomenal solution.
Anybody who saw the demonstration and saw the capability to manage your customer and prospect base, do all the segmenting, the ability to build the workflow around it, create the customer journey, or what we call introduce Journey Builder this week, it's just phenomenal. If you didn't have an opportunity to see the ExactTarget keynote, I would really encourage you to do that because you're really witnessing the future of marketing. In addition to that, we also announced that we are deeply integrating Pardot, which is part of the ExactTarget product line, into our Sales Cloud so that our Sales Cloud customers can have a very deep, rich, and very thorough campaign management deeply integrated into salesforce.com, which is something they've asked us to do now for many years. The combination of ExactTarget with Pardot, I've never seen a more comprehensive marketing solution.
To see the marquee customers showing up at the conference, all looking for a solution that's going to help them to grow their businesses in an aggressive way using these next-generation marketing techniques, whether it's email, whether it's social, whether it's the web, whether it's connecting to their products, whether it's deep capabilities with SMS, on and on. The ExactTarget team has done a phenomenal job. You saw Scott Dorsey, the CEO of ExactTarget, and Scott McCorkle, the Head of Technology, do a phenomenal reveal of a piece of technology that, when we were buying the company, just motivated us and said, "Well, they've absolutely created the future of marketing." Aneel, would you like to say anything about marketing?
Yes. We have not moved to the Marketing Cloud yet, but I would expect that we would do it over time for several reasons. One, the idea of getting a unified solution across the CRM suite just makes a ton of sense, and we've already standardized on sales and service. The second piece is, with such a good partnership with Marc and with the Salesforce team, these application decisions are as much about the people you do the business with as the products. I would expect over time as we have a project come up, that we would migrate over to Marketing Cloud.
Your next question comes from the line of Clint Boulton with The Wall Street Journal.
Hello. Congratulations. I was wondering, are you going to be making any changes to your service level agreements for customers as a result of these integrations? If so, what would those be?
Well, today, when we write service level agreements for our customers that are highly customized for each customer, different customers by industry or company size require different levels of performance and capability. Whether we're dealing with a large financial institution or a large media company, a large technology company, a large healthcare company, those service level agreements really tend to vary. I'll tell you that we are able now to sign up for a much higher level of quality, availability, and reliability specific to your point. As we write those agreements, we are able to assume a lot more risk into our corporation because of the phenomenal work that's going on between our two engineering organizations.
Your next question comes from the line of Serdar Yegulalp with InfoWorld.
Yeah, hi there. Thanks for bringing in my question. I was curious about whether or not you plan on testing the deeper integration you have between your two products internally at both your companies. There seem to be some hints that that's already going on, I'm wondering if you're planning on continuing to do that in a much deeper way, or if you are planning on testing in a more provisional way internally.
We are doing that now. Aneel, would you like to comment on that?
I think when you deliver an end-to-end cloud solution, you have to test it. That's the idea behind
A packaged integration versus a custom integration. We've already done a lot of the testing. We're just expanding the scope to include all the Salesforce products.
Your final question comes from the line of Steve Ashley with Robert W. Baird.
Hi, this is Chetan Ramada for Steve Ashley. Thanks for taking my question, and Marc and Aneel, congratulations. My question was just, to Marc, this is the second partnership we've seen in the last few months, and I was wondering if we should view this as setting cadence for more partnerships in the future, in the cloud or otherwise, and maybe in other domains, if you can comment on that. Thanks.
I don't think there's been a more important time for our customers to demand that vendors like Salesforce and Workday and others continue to work more closely together. We offer phenomenal solutions, but those phenomenal solutions are better when they work together. That's what customers want. They want that integration. They want partnership. They want vendors to have working relationships with each other. They want them to take, to the point of the previous question, responsibility for implementations and for service level agreements jointly. That's the kind of relationships that we want. You've seen us make other announcements this year that were of consequence and material to our company. Here's another one. You'll see more at Dreamforce coming up in November. I can just tell you that this is essential. Not all vendors have this philosophy.
There's vendors who have very much isolated themselves that are large software companies. As the market has changed and as the technology has transformed, they prefer to stand alone. They prefer to stand by themselves. They think they can do it all. They have their own black box mentality. We don't have that view. Workday doesn't have that view, and others don't have that view, but some do. I think increasingly, customers will have an aversion to vendors who don't have these types of partnerships and working relationships in place. Aneel, would you like to comment on that?
I would just echo everything you said. We live in an open world, and customers expect their vendors to collaborate to provide a better solution for them.
Great. I think that wraps up our call for today. I would like to thank everyone for participating and joining us. We know it's been a busy day and a busy week, but we appreciate it, and we'll look forward to speaking with you all soon.
This concludes today's Salesforce.com and Workday Strategic Partnership conference call. You may now disconnect.